Uber Hourly Guarantee Rates
How Does Uber’s Hourly Guarantee System Work?
Over the past year, Uber drivers have experienced rate changes. It can be frustrating for drivers who feel that they’re doing the same amount of work, but earning less.
Luckily, Uber has introduced a new hourly system (in addition to a number of new rewards programs), meant to maximize driver income.
If you’re a driver, it’s helpful that you understand this new hourly guarantee system. How do these guarantees work? What do you need to do in order to earn more?
What Is Uber’s New Hourly Guarantee System? How Does It Work?
Uber has introduced a new hourly guarantee system, ensuring that drivers make decent earnings, regardless of rate fluctuations.
To encourage drivers, Uber now offers a guaranteed minimum hourly gross fare. While working, if you earn less than the guaranteed amount, Uber will pay the difference. As you would expect, if you make equal to or more than this value, no additional payments will be made — commission will still be taken as it normally would.
Certain time slots have different guarantees — meaning, it won’t always be consistent. Here is an example provided by Uber, regarding Miami-based drivers:
”If a driver worked from 6pm to 8pm, guaranteeing $25 in fares per hour, they would be guaranteed $50 for that period of time. If the driver completed two tips, one for $28 and one for $12, the total would be $40 — $10 shy of the guaranteed amount. In turn, Uber would cover the additional fares, then take their regular commission.”
So technically, after a 20% commission fee, an additional $8 would be given to the driver. Remember, all calculations are based on your average earnings. If you make $10 one hour and $30 the next, you would average $20 — if this was the ”guaranteed” value, you would not receive anything for the first hour because all hours are combined to produce an average.
Of course, in order to qualify, there are certain requirements. Also, it’s important to be aware of certain time slots and their associated guarantees. Since rates vary from city-to-city, it’s important to check what guarantees are offered in your area (i.e., checking when guaranteed rates are higher, and when they are lower).
As you can imagine, on-peak rates will be higher than off-peak rates. For instance, on Fridays and Saturdays, from 10 pm to 3 am, the guaranteed hourly rate may be $20; whereas Monday through Thursday, from 5 am to 9 am + 10 pm to 1 am, the guaranteed rate may be $15. Get to know these offered time slots and what that means for your current schedule.
What Are the Requirements?
Although many drivers thought they needed to receive an email in order to qualify for the new hourly guarantee program, Uber has confirmed that this is no longer the case. They have, however, stated that you will need to opt-in to this new hourly system. If you did not receive an email to opt-in or are unsure whether or not you qualify, make sure you seek support.
Per qualifying hour, you must:
- Be online for at least 50 minutes
- Average at least 1 trip per hour
- Accept at least 90% of the trip requests that reach your phone
- In some cases, start at least 70% of your trips within a certain area (a map will be provided to you regarding these zones). For regions such as San Francisco, this number has been as high as 85%.
A Few Last Pieces of Key Information
Within some regions, the hourly guarantee is quite attractive, ensuring that drivers go home with a set income. At least you’ll know that you’re guaranteed to make x-amount for your time. Anything additional you make will be a bonus, so in that sense, the new system is good.
With that being said, there are a few things that make this system less attractive, including:
- Driver saturation — during times of high hourly guarantees, you can bet that there will be plenty of drivers on the road, which can make it more challenging.
- Surge pricing counts towards the gross fare — It is not an added bonus during these time periods.
- Be mindful of the requirements — In order to get the guarantee, but reduce wear and tear on their vehicle, some drivers will head to a busy area in order to knock out their required rides per hour. After this point, they will head to an area where there’s a lower demand, so that they do not get as many requests. Remember, rides are averaged out over the course of all hours worked. So, if you take ten rides within the first hour, but none the next three hours, you’re still averaging 2 rides per hour. Just be mindful of specific areas, understanding the hourly guarantee map for your region.
At the end of the day, the effectiveness of this new system highly depends on the market you’re driving in. Some drivers love it, while others aren’t as fond of Uber’s guaranteed hours. If you qualify, you will need to test it out for yourself.
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